All Forum Posts by: Leon Lee

Hey Fellow BPers! 

I'm diving into mid-term rentals and hoping to shift more of my units in that direction. I've got a few questions and I'm hoping you can shed some light on them, to help me streamline my approach to mid-term guests. Up to now, I've been focused on short-term rentals. The high fees on platforms, less recreational travelers vs. more business travelers, and the cost of cleaning are really pushing me to explore mid-term rentals more. It seems like a smoother path to profit with less hands-on management.

Here's where I'm at: I have units that attract guests, usually working-class workers sent by their companies, staying for 3-5 months. I noticed that the wear and tear for these MTRs are pretty similar to long-term rentals, especially with larger families. It feels like anything over a couple of months, and they start treating the place like their own home and start to modify everything.

First up, security deposits. My units rent for over $3,000 a month. A one-month deposit feels steep, as guests need to cough up $6,000 for the deposit and first month's rent. I'm charging $1,500 to $2,000 right now, thinking it should cover normal wear and tear and minor damages. What's your approach to security deposits?

Next, lease duration. During off-peak seasons, we've had tenants sign year-long leases at lower rates. But in peak seasons, these rates are way lower than what we may get by short-term rentals. I'm thinking of capping leases at three months, then going month-to-month afterwards. How do you handle lease lengths?

Then there's the notice period for lease termination. Mid-term tenants sometimes need to cut leases short due to project changes. I've set a seven-day notice period, which works both ways – it's also handy if we find tenants are too messy during inspections. What notice period do you work with?

Finally, cleaning costs. Short-term rentals bring in about $3,500 a month, but require 4-5 cleanings at $110 each. Mid-term rentals mean fewer cleanings, but check-out cleaning is intensive and pricey. If your guests are similar and stay for about three months, what are you paying for cleaning?

I generally paid more attention to posts about short-term rentals and less so for MTR, apologize if I asked repeated questions

Thanks for any insights you can share!

Lee

 If it is strictly rental revenue, make sure that the total revenue from a booking from the direct booking website or VRBO has cleaning fee, guest service fees, sales tax all removed before multiplying 20% for commissions. 

This question, though seemingly straightforward, actually requires careful consideration: When a management company charges a 20% fee, what exactly does this percentage apply to? Does it refer to the gross income alone, or does it include additional components like cleaning fees? Is it calculated on the gross income inclusive of varying sales taxes which vary from different counties and cities? And does it factor in both guest and host service fees? It's important to note that the definition of gross income can include all different things across different booking platforms such as Airbnb, VRBO, Booking.com, and direct bookings.

 Just checked online that Nest Thermostat and Nest Thermostat E can be locked within a range. Google Nest Thermostat can NOT be locked. I have about 40% units having Google Nest Thermostats. 

Thanks

Lee

 Isn't any stay (MTR) longer than 28 days considered LTR and should fall under landlord tenant law? Just curious, as we ask any guests staying longer than 30 days to sign a lease. 

We've seen that when guests stay for more than three months, the wear and tear on the house starts to resemble that of a long-term stay. That advantage of less wear and tear we usually see with short-term rentals? It kind of disappears. While we do appreciate the steady income from mid-term guests (which is a real plus in these economic times), we're trying to strike a sweet spot between our short-term and mid-term rental approaches. 

What are your thoughts?

Hi, All

Some follow ups: 

To promote responsible utility usage and maintain fairness, we're introducing caps on utility bills. Moving forward, we'll cover up to $180 each for electricity and gas, and up to $80 for water. Any usage beyond these amounts will be the responsibility of our guests.

We're also implementing two new policies:
1. We're setting a maximum lease duration of three months. This change aims to prevent the locking in of lower rent rates during our less busy periods.

2. We will conduct monthly inspections to maintain the quality of our properties, which will include regular pest control.

@Sarah Kensinger, we understand your concerns. We've equipped all units with smart thermostats for efficiency. However, we've encountered situations where guests have set the temperature to extremes, like cooling the house to 70°F in 35°F weather. Recently, while I was updating the Wi-Fi in one of our units, I noticed the sound of water running in a pipe behind the wall. Upon investigation, it turned out that the hallway toilet had been running continuously for an extended period. It appears this issue wasn't reported to us, likely because our guests aren't responsible for the utility bills. 

We're cautious about setting locked temperature ranges to avoid (incidental) damage to the thermostats.

We appreciate all the feedback we've received so far and welcome further suggestions.

Lee

Hi, Fellow BPers

So, I was doing a little happy dance because we finally got stable mid-term guests in about 30% of our units. But then, bam! I get hit with this nearly $400 power bill for a 1200 sqft townhouse for last month (It was cold, but not that cold in Atlanta). Yeah, not so happy anymore. I'm thinking of tweaking the rental agreements for the future. Like, putting a cap where I'll cover up to $200 for electricity, water, or gas, and if it goes over, that's on the tenant. Does that sound fair?

I'm curious, how do you guys keep a lid on utility bills with your mid-term guests? And any tips on handling this with guests who've already signed the contract?

Thanks a bunch!

Lee

 They are VERY expensive and be careful about the duration of their contract as well

 This is genius! I was literally searching for a lockbox for modem and router online: guests do all kinds of stuff and they did not spare the modem and router!